Recent high school graduates Abbigail Deason and Grace Branscum, both 18, of Oklahoma City relax inside Meow Wolf's mazelike exhibition space in Santa Fe, N.M., on Friday, July 14, 2017. The startup company behind the popular art installation is seeking out small-scale Internet investors as it lays the groundwork for expansion to major metropolitan markets.

Caryn Saeger, 28, of Delta, Ohio, and her 2-year-old daughter Chloe explore Meow Wolf's mazelike exhibition space in Santa Fe, N.M., on Friday, July 14, 2017. The startup company behind the popular art installation is seeking out small-scale Internet investors as it lays the groundwork for expansion to major metropolitan markets. (AP Photo/Morgan Lee)

Arts startup Meow Wolf sells out small equity offerings

By MORGAN LEE

Jul. 18, 2017

SANTA FE, N.M. (AP) — The startup company behind a popular immersive art exhibition space in New Mexico has has raised more than $1 million through an online private stock offering aimed at small investors.

Meow Wolf reached the fund raising goal Monday after offering equity stakes in increments of as little as $1,000 through the crowdsourcing website WeFunder.

A preliminary, discount offering in late June was followed by a broader sale starting on Saturday. The company said it quickly reached its regulated annual cap for equity crowdfunding with sales to 480 small investors. Shares still were available Tuesday for larger investors.

Dylan Enright, director of fundraising for WeFunder, said the flurry of buying over a two-day period outpaced all previous offerings that he has seen since the beginning of regulated equity crowdsource fundraising in early 2016.

More than 500,000 visitors have flocked to Meow Wolf's walk- and crawl-through exhibit space in Santa Fe since early 2016. The art complex now encompasses a gift shop, nonprofit educational studio, live music venue, food truck, and a craft beer and wine area.

CEO Vince Kadlubek has described the investment as a leap of faith as the company prepares to expand into major U.S. cities.

Shares were not paired to a stock exchange — and came with no guarantee they can ever be sold by small investors, who must wait at least a year to sell outside the company.

Ownership stakes were based on a valuation of $62.5 million, with shares selling over the weekend for $40 each.

Small investors don't get to vote on company decisions, though they scooped up perks including annual admission passes.

The business, a public benefit corporation that can set community priorities ahead of profits, has been raising money to outfit a new studio in Santa Fe with manufacturing equipment as it seeks to open in major metropolitan markets. Austin, Denver, Las Vegas and Houston have been mentioned as likely possibilities for new exhibition spaces.

"We're enormously humbled and motivated by the faith and support displayed by our guests, employees, friends and digital neighbors," Kadlubek said in a statement.

Meow Wolf was closing in on approval for $1.1 million in economic development incentives from the New Mexico and the city of Santa Fe. The state has authorized $850,000 in support, contingent on $250,000 in city funding. A Santa Fe city finance committee on Monday recommended approval.